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Pampa Energia SA (NYSE:PAM)
Beneish M-Score
-3.39 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Pampa Energia SA has a M-score of -5.52 suggests that the company is not a manipulator.

PAM' s 10-Year Beneish M-Score Range
Min: -6.24   Max: 2.81
Current: -3.39

-6.24
2.81

During the past 11 years, the highest Beneish M-Score of Pampa Energia SA was 2.81. The lowest was -6.24. And the median was -2.62.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Pampa Energia SA for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.9394+0.528 * -3.0189+0.404 * 0.8688+0.892 * 0.9565+0.115 * 1.1126
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3772+4.679 * -0.1412-0.327 * 1.1874
=-5.52

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $272.6 Mil.
Revenue was 180.163240629 + 173.084280532 + 166.416444982 + 172.986457074 = $692.7 Mil.
Gross Profit was -0.485126964933 + 13.7563482467 + -7.16239419589 + -2.84679564692 = $3.3 Mil.
Total Current Assets was $515.1 Mil.
Total Assets was $1,734.8 Mil.
Property, Plant and Equipment(Net PPE) was $928.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $47.9 Mil.
Selling, General & Admin. Expense(SGA) was $159.1 Mil.
Total Current Liabilities was $708.3 Mil.
Long-Term Debt was $422.0 Mil.
Net Income was 37.4475211608 + -47.1711003628 + -11.9176541717 + -19.4207980653 = $-41.1 Mil.
Non Operating Income was 11.5659008464 + -36.7036275695 + -33.5547762999 + -0.332889963724 = $-59.0 Mil.
Cash Flow from Operations was 56.7215235792 + 60.400241838 + 83.3472793229 + 62.3642079807 = $262.8 Mil.
Accounts Receivable was $303.4 Mil.
Revenue was 137.710519952 + 168.343168077 + 190.216565901 + 227.878960097 = $724.1 Mil.
Gross Profit was -9.36880290206 + -12.4869407497 + 5.6592503023 + 5.90084643289 = $-10.3 Mil.
Total Current Assets was $418.7 Mil.
Total Assets was $1,474.7 Mil.
Property, Plant and Equipment(Net PPE) was $771.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $44.5 Mil.
Selling, General & Admin. Expense(SGA) was $120.8 Mil.
Total Current Liabilities was $482.2 Mil.
Long-Term Debt was $327.1 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(272.59879081 / 692.650423216) / (303.375332527 / 724.149214027)
=0.39355898 / 0.41894036
=0.9394

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(13.7563482467 / 724.149214027) / (-0.485126964933 / 692.650423216)
=-0.01421758 / 0.00470949
=-3.0189

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (515.118258767 + 928.407859734) / 1734.7974607) / (1 - (418.656590085 + 771.083071342) / 1474.73966143)
=0.16789934 / 0.19325445
=0.8688

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=692.650423216 / 724.149214027
=0.9565

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(44.5379685611 / (44.5379685611 + 771.083071342)) / (47.9172914148 / (47.9172914148 + 928.407859734))
=0.0546062 / 0.04907923
=1.1126

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(159.140024184 / 692.650423216) / (120.806045949 / 724.149214027)
=0.22975518 / 0.1668248
=1.3772

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((421.999153567 + 708.346674728) / 1734.7974607) / ((327.094679565 + 482.183675937) / 1474.73966143)
=0.65157222 / 0.54876015
=1.1874

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(-41.0620314389 - -59.0253929867 - 262.833252721) / 1734.7974607
=-0.1412

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Pampa Energia SA has a M-score of -5.52 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Pampa Energia SA Annual Data

Jun05Jun06Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.53990.53550.87670.98821.09310.99551.8429
GMI 1.4851.0931.0541.21921.50822.3609-1.0266
AQI 0.56111.08390.77041.04442.05530.78030.5969
SGI 11.58482.71351.01981.1891.19571.15050.7968
DEPI 0.82030.50331.08850.91450.89781.06331.1461
SGAI 0.80580.88341.14781.06071.031.00281.7581
LVGI 1.04531.11490.93571.09661.15431.15641.2517
TATA -0.0243-0.0633-0.0942-0.0594-0.1359-0.1441-0.0778
M-score 6.50-1.67-3.08-2.52-2.23-2.44-3.68

Pampa Energia SA Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 1.05440.59960.67430.99820.77491.74552.23581.8372.13050.9394
GMI 1.62411.61351.98322.465412.8615-6.2017-2.2455-0.9839-0.945-3.0189
AQI 1.95260.83692.00110.78030.90210.68180.76010.59690.57160.8688
SGI 1.50011.52531.48261.14741.12410.9530.84840.79940.80970.9565
DEPI 1.66061.3270.94671.06330.69561.14281.1161.14611.35921.1126
SGAI 1.22551.05491.04951.04231.05031.38051.52411.74011.71941.3772
LVGI 1.22681.11821.04421.15641.14771.15581.2291.25171.28791.1874
TATA -0.097-0.1367-0.1344-0.1466-0.1884-0.0616-0.086-0.0783-0.0736-0.1412
M-score -1.76-2.77-2.08-2.402.67-6.16-3.84-3.66-3.33-5.52
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